This sounds like an ad, but I swear I have no interest in VinoShipper other than to wish them success in freeing us from our chains.
I met recently with Steven Harrison of VinoShipper.com, who has, for eight years, been operating a DTC compliance and tracking tool which I think has become a real game changer. VinoShipper’s strategy is to take title of wines, under their network of licenses and relationships. This transfer effectively allows VinoShipper’s DTC licenses to be utilized in most states, obviating the need for individual wineries to obtain and maintain their own direct ship licenses, thus allowing wineries of all sizes to compliantly sell to many more states, with no investment from the wineries.
I was quite skeptical at first. Doesn’t Granholm vs Heald restrict itself to interstate shipment of wines produced by the shipping entity? But Steven pointed out the flaw in this thinking. What, exactly, is meant by "production?" Take a look at your monthly 702. In the Federal definition of wine production, the same wine can, on the monthly form can be produced by a dozen different actions: by fermentation, by sweetening, by blending, each over and over. The designation “produced and bottled by” requires 75% of the wine to be produced by fermentation on the premises, but this designation is in use on only a small minority of wines. Nothing Gallo bottles in its vast Modesto plant is fermented there, thus the flexible designation “Vinted and bottled by.” Wineries buy and sell bulk wine all the time and bottle it as their own, and there is even a lively trade in “shiners,” bottled unlabeled goods.
So where is the line? There are fifty different answers, buried in the licensing language drafted by fifty State legislatures, most of whom understand very little about winemaking law.
Steven’s approach is to review, for each State, exactly what the law states, and to comply with it. I spent three hours going over these individual strategies with Steven, and it sure looks like he has done his homework. A few important States remain where it seems a license must still be obtained, but one by one, he has worked out methodologies for most of the country.
The best news is, there is no installation or monthly recurring fee and he only charges 4.75%-8.75% plus a per-bottle fee for the service, and that includes full compliance, filing most State excise tax reports (that's right - the winery doesn't have to file), 3rd party age verification, merchant processing fees and more. No wonder over 500 wineries have joined.