Wineries can’t use the nation’s two biggest shipping companies to ship bottles directly to Arkansans who stop by for a tasting or tour and then decide to send a bottle or two home.
A year-old state law now allows wineries to directly ship their products to consumers under certain conditions.
But both FedEx and UPS still list Arkansas as a state where shipping wine directly to consumers is prohibited, according to spokesman for both companies. And, both said they were unaware that the Arkansas Legislature passed a law in 2013 allowing out-of-state wineries to ship their products to Arkansans when a state resident visits their winery and wants to buy some to send home.
FedEx spokesman Scott Fiedler said that the company expects to update its policies sometime in May to include Arkansas as a permitted destination for direct shipment of wine by a consumer.
“We will follow all state and federal laws regarding wine shipping,” Fiedler said. “Right now, on our system, I’m showing that we cannot ship into Arkansas.”
A spokesman for UPS, Susan Rosenberg, said the company is now considering how to handle the change in Arkansas law, but didn’t know when any policies might be adopted.
“Arkansas is still not an acceptable destination for consumers to receive shipments via our service,” Rosenberg wrote in an email.
Michael Langley, director of the state Alcoholic Beverage Control’s administrative division, said he was unaware of any shipping issues.
Langley said that so far, 51 wineries - mostly out-of state - have obtained permits to ship wine to directly Arkansas consumers now that the rules are in place that allow the state to track which wineries are shipping directly to consumers as well as collect sales and excise taxes.
But Langley said no one from either the wineries or shippers has contacted him about being unable to ship wine into the state.
“I haven’t spoken to anybody from FedEx or UPS,” Langley said Wednesday.
Langley said he didn’t think his agency needed to contact shippers about the change in the law. “They’ve got their own lobbyists and folks who follow how the law works,” he added.
“We get phone calls every day [from someone saying], the winery told us it’s not allowed in Arkansas,” Langley said earlier this week. “It is, they just have to contact us and we’ll provide them with paperwork.”
A year ago, the Legislature passed Act 483 of 2013, which took effect Aug. 16. However, the rules needed to implement the new law hit several snags and were not finalized until earlier this year.
The law allows the direct shipment from a winery to the buyer’s home of up to a case of wine once every quarter. For the shipment to take place, however, the buyer must be present at the winery at the time of the sale and the winery must register with the state and collect excise and sales taxes. The new law doesn’t allow sales online, by phone or mail order.
Act 483 amended an earlier state law that barred direct shipments to either in-state or out-of-state consumers. The older law was passed after the U.S. Supreme Court ruled that state laws that allowed in-state wineries to directly ship wines violated the constitution’s commerce clause if out-of-state wineries weren’t granted the same privilege.
Langley’s office hoped to create a website where wineries could go to register for direct shipment, but the website is still being developed, he said. However, if a winery contacts his office directly,and as long as they quickly get a sales and use tax permit, Langley said a permit can be quickly processed.
Jeremy Benson, a spokesman for Free the Grapes!, an organization that supports efforts to allow consumers to have wine directly shipped to their homes, wasn’t surprised about the confusion over shipping wine to Arkansas. Free the Grapes, based in Napa, Calif., describes itself as a coalition of consumers, wineries and retailers seeking to reduce state restrictions on purchasing wines directly from wineries and retailers anywhere in the country.
As more states loosened wine shipping restrictions, the time needed for everyone involved to adjust their rules is a consistent issue, Benson said. He said wineries typically rely on state trade associations to provide information about changes to shipping rules.
Benson said it takes time for states to adopt rules to implement a wine shipping law and then both wineries and common carriers have to figure out what they need to do to ship into a state.
“It’s sort of a gradual ramp up of activities based on these rules needing to come together from these different entities,” Benson said. “That piece is not surprising.”
Fiedler agreed that it takes time to adjust to new state laws that might affect shipping.
“That would ripple through the entire wine-shipping community. All of the wineries and vineyards and those systems would have to get updated,” Fiedler said.
Nine states prohibit direct shipment of wine to consumers, Benson said, while the rest allow some form of direct shipment. Benson said Arkansas is one of five states that require consumers to be at a winery to place an order to be shipped home.
While private carriers FedEx and UPS are in the process of reviewing their wine shipment rules for Arkansas, consumers can’t turn to the U.S. Postal Service as an alternative way to send wine home. The postal service prohibits customers from shipping wine or alcohol through the mail, according to spokesman Leisa Tolliver-Gay of the Little Rock main post office.
Rosenberg said that even if UPS is notified about the new state wine shipping requirement, it may take additional time for the company to start accepting wine destined for Arkansas.
“Each time a new state is added, all the drivers in the state have to go through that certification process before UPS would begin shipping wine to that area,” she said.The company has to ensure its drivers are trained on issues such as how to properly verify the age of anyone the wine is addressed to, she added. Training drivers on issues such as proper age verification takes time, she said.
“Every state is a little bit different,” Rosenberg said, making it a challenge when UPS wants to have uniform policies and procedures for interstate commerce.
Business, Pages 23 on 04/03/2014