While a recent legal clarification made by the Pennsylvania Liquor Control Board came at the request of a Pennsylvania beer manufacturer and two distributors, not all in the industry are happy with it.
Late last week, the PLCB said it would allow beer to be sold at distributors as 12-packs. The number of bottles could vary as long as the package met the minimum of 128 ounces.
Previously, distributors could only sell bottles and cans by the 24-pack case. Smaller portions could only be sold by bars or six-pack shops.
The Brewers of Pennsylvania, a Harrisburg-based industry group, said its problem with the way the law is now being interpreted is that it gives an unfair advantage to larger out-of-state brewers.
“Today, we can provide six-packs and even 12-packs for sale at distributors, but nearly all of our members do not have manufacturing and packaging capability to offer 18-packs,” said Brewers executive director Dan LaBert.
While it’s not clearly stated in the law, 18-packs would be allowed under the interpretation, according to Ted Zeller of Norris McLaughlin & Marcus PA of South Whitehall Township, the attorney representing the brewers’ group.
“Those are referred to in the industry as predatory packages,” Zeller said.
Zeller said major brewers such as Budweiser will make 18-packs that are priced to compete with 12-packs.
“It immediately puts the other beer at a competitive disadvantage on price,” Zeller said.
While the average beer consumer wouldn’t be choosing between a beer such as Easton’s Weyerbacher versus Budweiser based on price, Pennsylvania’s largest brewer, Yuengling, has a lager light product that directly competes with light beers made by Budweiser, Coors and Miller.
Yuengling does not make an 18-pack.
Zeller also said that while the major global breweries already have the ability to put together 12-packs, only 10 percent of Pennsylvania’s breweries do.
He said it’s not just a matter of changing the way they package the beer. It would mean the installation of hundreds of thousands of dollars of packaging equipment.
“A brewery like Weyerbacher doesn’t have the space for that … and it doesn’t have it budgeted in its business plan,” Zeller said.
He said the group had hoped the matter would have been resolved legislatively in a manner that would have allowed for provisions for the sale of six-packs, which the brewers already manufacture.
The attorney said the irony of the situation is that the reason Pennsylvania-based brewers that sell in Pennsylvania don’t have 12-packs is because the state hasn’t allowed for their sale at distributorships, and bars and six-pack shops can easily sell the beer as six-packs.
“The reason they don’t have this is because they relied upon the case rule that’s been in place since Prohibition,” Zeller said.
LaBert said the group believes that the ruling “fails on some levels and has inexplicably handed to out-of-state, global brewing entities.”