law
From The Oxford Companion to Beer
regulating alcohol, its production, distribution, and consumption has existed almost as long as alcohol has been a part of society. As alcohol entered the social life of a community, alcohol control policies developed. Whereas the Sumerians of old Mesopotamia were the first civilization to turn fields of grain into rivers of beer, their conquerors, the Babylonians, turned beer making into a target of governance, especially once Hammurabi (1728–686 bc) took over. Hammurabi ran his realm with an iron fist, and no facet of life, including beer, could escape his “code,” which is now considered mankind’s first body of laws. The “code of Hammurabi” remains chiseled into a 7-foot-high column of gray–green igneous diorite, which now rests in the Louvre in Paris. In these laws, Hammurabi classified beer into 20 different categories, 8 of which had to be made entirely from barley; others could be made from a mixture of grains. The most highly valued and most expensive Babylonian beer was pure spelt beer. There were also pure wheat beers, thin beers, red beers, and black beers—as well as an aged beer for export, mostly to Egypt, where the thirst for beer was rapidly spreading. He then slapped price controls on both the brewers and the innkeeper, and the first beer laws were enacted.
Since then, communities have experimented with various methods of alcohol control, from heavy taxation to the outright prohibition of all alcoholic beverages. Perhaps the two most famous and most consequential to this day are the Bavarian Beer Purity Law (Reinheitsgebot) of 1516 and Prohibition in the United States (enacted by the 18th and repealed by the 21st Amendments).
The Reinheitsgebot mandated that only barley, water, and hops be used in beer making (the role of yeast in fermentation was still a mystery in those days). But that decree also established firm beer prices for Bavaria, which was a key objective of the decree and is much underappreciated by modern devotees of the brewing techniques that it spawned. In fact, the word “Reinheit” (purity) does not even appear in the original document and only 31 of its 315 words, that is, only 9.85% of the decree, deal with beer ingredients. The rest spell out mandatory summer and winter beer prices as well as penalties for violators of the price control edict. Over the centuries, the edict was amended to include yeast as a legitimate beer ingredient, and the price controls were removed. In their stead, complicated rules were added, permitting the use of malted wheat as well as sugar invert adjuncts, but only for top- fermented beers. It also specified that any brew not following the legislators’ ingredients prescriptions could not be called “beer” and detailed the taxes brewers had to pay on their wort. The edict acquired its current name “Purity Law” only in 1918, after an obscure delegate to the Bavarian state parliament called it such during a beer tax debate.
American Prohibition, by contrast, rather than regulating the making, selling, and transporting of alcoholic beverages, simply forbade them entirely. Prohibition, oddly, did not explicitly ban the possession or consumption of alcohol, but only its production and sale. Organized crime and bootlegging quickly became effective at supplying a demand that legal entities no longer could. But the repeal of Prohibition came at a cost: the system of “no” was replaced by a federally licensed three-tier system, which forbade brewers to sell their product directly to an on-premise or off-premise retailer or to the consumer directly. Instead, beer could only be distributed to retailers and the public indirectly, through a middleman called a distributor or wholesaler. The ostensible intent of this complex licensing and distribution system was to eliminate the criminal element from alcohol sales, as well as to blunt the main arguments of the Prohibitionists, namely their opposition to vertically integrated distribution systems that allowed breweries to own distributorships as well as saloons as so-called tied houses and thus create local or regional monopolies and dictate prices. By separating the tiers, it was thought that brewers would have to compete for the portfolios of distributors and distributors would have to compete for the portfolios of retailers and levels of distribution. Although this model makes sense in theory, it has not always had the desired effect in practice. Large national brewers can still grant or withhold such favors as credits to wholesalers and thus place them under duress simply by virtue of the size of the wholesaler’s business a particular brand represents. Small breweries may have difficulty getting their beers in front of consumers simply by virtue of the small chunk of business they represent to the distributor in their local market. For the brewer, then, the distributor’s attention, or, as it has been termed, “share of mind,” becomes almost as important as gaining the consumer’s attention and approval. The vertically integrated distribution model, with its dedicated distributors and tied houses, has been replaced by federal and state regulations in the United States, but it is still widely used in Germany, Ireland, and many other countries.
In the United States, individual states were empowered, after Prohibition, to fashion their own particular regulations as to how the three-tier system was to operate in detail within their territorial boundaries. As a result, an incredibly complicated mosaic of different and often conflicting sets of state legislation emerged to regulate commerce in alcohol. Some states reserved alcohol sales exclusively to state agencies; other states created state alcoholic beverage control boards to oversee the licensing of enterprises involved in the manufacture and sale of alcohol. Yet other states have set rules as to which stores might carry alcoholic beverages and which cannot. In some states, therefore, only specialized liquor or “package” stores were allowed to carry spirits, wine, and/or beer; in other states, grocery stores, including supermarkets, were permitted to carry alcoholic beverages. In some states, there were even regulations as to the amount of alcohol beer might contain. Many of these regulations, some of them spectacularly odd, remain in place today.
Although Americans tend to think of Prohibition as uniquely American, it was not—of the Nordic countries, only Denmark escaped any form of severe control during the 1910s and 1920s. Full alcohol prohibition was short in Iceland, lasting only from 1915 to 1922, but beer remained banned until 1989. Sweden’s rationing system eventually gave way to today’s state monopoly (Systembolaget), and similar systems remain in place in Norway (Vinmonopolet), Iceland (Vínbúðin), and Finland (Alko). Even Belgium, a bastion of brewing culture, suffered a creeping form of liquor prohibition starting in the 1890s.
One of the main goals of alcohol control legislation—often wrapped in the mantle of moral duty, the preservation of public order and decency, the protection of public health, and the curbing of crime—is the generation and control of revenues. In other words, laws regulating alcohol invariably involve taxes on alcoholic beverages as well as licensing fees levied on those enterprises that are engaged in their manufacture and sale.
Another method of alcohol control—one that is gaining increasing appeal worldwide—is the imposition of a minimum drinking age. In 1984, the United States required all states to raise the minimum drinking age to 21 years. Other countries, which traditionally did not have legal drinking ages, have more recently followed suit with similar legislation. France, for example, enacted a minimum age of 18 for the purchase of alcohol. In most countries, the stated minimum age for purchase of alcoholic beverages is between 16 and 18 years. Many countries do not criminalize consumption of alcohol by minors if they are with their parents.
Most nations also have laws restricting the advertising and marketing of alcoholic beverages. These may range from complete bans of advertising in mass media to strict regulations as to what may or may not be stated in marketing of alcoholic beverages. But beer manufacturers have become creative in working within the marketing restrictions. Beer marketing campaigns subtly target specific groups and involve print, television, and internet media, as well as sponsorships and contests.
Given the myriad of legislative and administrative involvement in the manufacture and distribution of beer and alcoholic beverages in general, the alcohol industry is one of the most highly regulated industries just about everywhere in the world. Each nation has found its own peculiar ways of prescribing what the industry may and may not do…and of course, of profiting through fees and taxes from that involvement. Breweries, beer wholesalers, and retailers must adapt to the rules and regulations that govern their businesses in their local environments.
This definition is from The Oxford Companion to Beer, edited by Garrett Oliver. © Oxford University Press 2012.