US State Liquor / Wine stores under attack

[Rail Paul]

The Wall Street Journal has a mention that the European Union has identified a number of anti-competitive practices in the US, which discourage the sale of European products. One such practice is the state run alcoholic franchises in 19 US states.

"State stores" are typically run by a government authority, with government employees as clerks and warehouse staff. The state decides which products may be sold to residents of the state. Private importation from a foreign jurisdiction (for example, from Maryland into Pennsylvania) is prohibited or very limited. No private stores are permitted for the sale of liquor or wine.

The EU believes this practice deprives potential buyers of wine from a free choice of a wider selection. If an importer is not able to meet the often high minimum shipping volumes required by an authority, it may be squeezed out of the entire state.

For once, an EU concern which makes sense and is actually good economics.

[vengroff]

State control of importation and distribution of wine is getting hit hard on a number of legal fronts. This can only help. The only group that seems to be seriously fighting liberalization are the big distributers that are going to get cut out of the middle.

[Craig Camp]

Isn't this the same as what they do in Sweden?

[vengroff]

Isn't this the same as what they do in Sweden?

What do they do is Sweden?

[Beachfan]

All liquor stores are run by the government in Sweeden.

[ctgm]

I also think that Finland has a Monopoly board as well.

Other countries like Japan and Taiwan have relaxed their import regulations to come into line with GATT but I don't think that the US have had the pressure applied to them yet.

With regards to this little spat with the EU, is it some retaliation to something else? The usual favourite that the EU and US squabble about is bananas! I suspect probably not as this has been a "problem" to EU producers for some time.

[mogsob]

I think those folks over in Brussels have had a few too many. There are significant sovereign immunity issues here that will prevent US States from being subject to an EC complaint.

Personally, the EC should thank their stars that NY and other East Coast states make it near impossible to directly import wine from California. If that anticompetitive law were to be scrapped, the sales of French and Italian wine would likely suffer.

[vengroff]

Personally, the EC should thank their stars that NY and other East Coast states make it near impossible to directly import wine from California.  If that anticompetitive law were to be scrapped, the sales of French and Italian wine would likely suffer.

New York's law has been struck down by a recent court case, but remains in effect pending appeal.