Recent Amendments to Licensing Laws Affecting Craft Breweries and Brewpubs

By on January 31st, 2014

Posted in New Jersey

Recent changes to the New Jersey Limited Brewery License and Restricted Brewery License have made the State a more favorable environment to establish a craft brewery or brewpub.

In New Jersey, craft breweries can apply for a Limited Brewery License, which permits the brewery to produce up to 300,000 barrels of 31 gallons of malt alcoholic beverage per year.  Traditionally, such establishments were permitted to sell and distribute this product to licensed wholesalers and retailers.  However, service to the consumer was limited to offering samples under to a separate permit issued by the Director of the Division of Alcoholic Beverage Control.  With the recent amendments to the Limited Brewery License that went into effect on December 1, 2013, craft breweries holding this license are now permitted to sell their product at retail to consumers on the licensed premises for consumption on premises in connection with a tour of the brewery.  Further, such license holders are also now permitted to sell their product for off premises consumption in a quantity of 15.5 gallons or less.  Currently, the license application fees for the Limited Brewery License in New Jersey range from $1,250 to $7,500, depending on production capacity.

Those looking to establish a brewpub in New Jersey must hold a Restricted Brewery License.  This license permits the holder to brew a specified amount of malt alcoholic beverages and sell such product for consumption in an immediately adjoining restaurant premises having adequate kitchen and dining facilities that are principally used for the purpose of providing meals to its customers.  This license may only be issued to a person or entity that has the same ownership to an entity that holds a Plenary Retail Consumption License.  The December 1, 2013 amendments to this license have generally made it more useful to its holder in furtherance of his brewpub business.  For example, a Restricted Brewery can now produce up to 10,000 barrels of 31 gallons per year, which is an increase from the previous 3,000 gallons.  Also, the holder of a Plenary Retail Consumption License can now hold up to 10 Restricted Brewery Licenses.  Finally, holders of the Restricted Brewery License are now permitted to sell and distribute their product to licensed wholesalers.  The fees for the Restricted License are $1,250 for the initial application, plus $250 for every 1,000 barrels produced beyond the initial 1,000 barrels.

The amendments discussed above are a welcome change for the craft beer industry in New Jersey and increase the state’s attractiveness as a place to establish such a business.

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